HK-Guangzhou: What the GDP figures don’t tell

Guangzhou officials have been bragging that the city’s 2015 economic output would reach 1.8 trillion yuan and that the per capita GDP would hit US$20,000 for the first time. Shenzhen’s corresponding figure is said to be 1.75 trillion yuan.

Hong Kong is yet to announce its 2015 GDP but the previous year’s figure was around HK$2.26 trillion, or 1.91 trillion yuan, according to official data.

The data and the expected Chinese numbers have fueled speculation that Guangzhou and Shenzhen could overtake Hong Kong in GDP in 2016.

Hong Kong’s annual economic growth has been around 2-3 percent in recent years. The city was surpassed by Shanghai in GDP output for the first time in 2011, and so did Beijing in 2013.

One thing to note, however, is that Guangzhou still trails Hong Kong by a large margin on a per capita basis — US$20,000 versus US$40,100.

And even that figure of Guangzhou is believed to be grossly inflated as the city’s actual population was already over 16.7 million in 2014, 9.46 million more than that of Hong Kong, according to a Guangzhou Daily report, but the government deliberately excluded migrant workers – roughly 3 million in total – when calculating the per capita GDP.

All mainland cities edit their per capita GDP statistics in similar fashion. The 2014 figures of Shanghai, Beijing and Shenzhen, all converted into US dollars, were US$15,847, US$15,184 and US$ 22,701 respectively, according to a People’s Daily report. The three cities all have populations that are on much higher scale compared to that of Hong Kong.

More numbers will help present a full picture: Hong Kong’s total area is 1,104 kilometers, equivalent to half of Shenzhen’s total land area, one fifth of Shanghai, one sixth of Guangzhou and one fifteenth of Beijing.

Hence, a fair conclusion is that while first-tier mainland cities boosted their economic scale over the past years, capitalizing on their demographic dividend and ample land supply, Hong Kong’s record is more laudable as the economy is more efficient despite its tiny size, both in population and land area.

A sizable GDP is the ticket to the elite club of the world’s urban centers, and there’s no denying that Guangzhou is well poised to regain its old days of glory when the city was better known as Canton.

Hong Kong and Guangzhou have long, interwoven ties. One of Asia’s first modern railway linking the two cities began operating in 1910, after Hong Kong superseded Guangzhou’s monopoly in trade.

Refugees from Guangzhou and its adjacent areas became the pillar source of Hong Kong’s population growth, with almost a million fleeing to the British colony during the time of Japanese occupation of the mainland, cementing the ever-lasting bond of shared lineage.

Guangzhou became the testing stone when Hong Kong businessmen started their China foray in the 1980s. Henry Fok Ying-tung built China’s first five-star hotel in Guangzhou, the White Swan Hotel. He also spearheaded the development of the city’s Nansha district, now one of China’s pilot free trade zones.

Guangzhou has long been Hong Kong’s economic hinterland and a pivotal trading partner, home to the largest cluster of Hong Kong companies operating outside the territory and a main destination of outward investments.

Its close proximity to Hong Kong was also a major consideration for choosing the city to host the China Import and Export Fair, the nation’s largest trade exhibition by turnover, since the 1950s.

The city’s two landmarks — the 391-meter, 80-storey Citic Plaza in Tianhe district and the 530-meter, 116-storey Chow Tai Fook Finance Centre in Zhujiang New Town, are both Hong Kong invested.

Other aspects suggest how the integration and dynamics complement each other’s development. Guangzhou port handled more goods and containers while Hong Kong acts as a global arbitration center for shipping firms including those based in Guangzhou.

Hong Kong airport is where electronic and information products made in the Pearl River Delta begin the journey overseas. And Guangzhou’s flagship conglomerates — Yuexiu, Evergrande, Guangdong Holdings, Guangzhou Automobile, Country Garden, China Southern Airlines and Netease, to name a few — have all flocked to Hong Kong to tap the capital market.

All these are the facts that changes in GDP statistics won’t tell you, even though the headline figures may help mainland netizens engage in their favorite game — one-upmanship.

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